CPD IN THE NEWS

Oh, what a difference a year can make.

Last July, Federal Reserve chairwoman Janet Yellen endured criticism for House testimony in which she seemed to imply that there was little the Fed could do to address the disproportionately high African-American unemployment rate.

Not so on Tuesday. In her semi-annual testimony to the Senate Banking Committee, Yellen emphasized that the failure of the economic recovery to reach communities of color influences the Fed’s decision-making, and made a strong commitment to improving diversity at the central bank.

“Jobless rates have declined for all major demographic groups, including for African Americans and Hispanics,” Yellen said, according to her prepared remarks. “Despite these declines, however, it is troubling that unemployment rates for these minority groups remain higher than for the nation overall, and that the annual income of the median African-American household is still well below the median income of other U.S. households.”

Yellen’s policy argument has not fundamentally changed. It is the Fed’s job to maximize employment in the economy as the whole, she says, and it lacks the tools to target particular communities. And the Fed chief has clarified since last summer that she takes seriously how the Fed’s adjustment of interest rates can have an especially big impact on African Americans and Latinos, who have higher jobless rates.

But Yellen’s remarks and actions on Tuesday represent the Fed’s greatest demonstration yet that it is putting the concerns of communities of color front and center on its agenda.

The Fed Up campaign, a coalition of progressive groups that has led the push to make the Federal Reserve more responsive to workers in general, and communities of color in particular, was pleased with the focus of Yellen’s testimony.

“Each time since Yellen spoke last July, when she got pushback over what she said, she has gotten a little bit better,” said Jordan Haedtler, Fed Up’s campaign manager. “Now she is proactively showing that the Fed is assessing this data and does take this data into account.”

Diversity is an extremely important goal and I will do everything I can to further advance it.

This week’s hearings, held every six months in both chambers of Congress — the House will hold its hearing on Wednesday — are an opportunity for the Fed chair to update lawmakers about the overall state of the economy. As part of the briefing, the Fed releases an accompanying monetary policy report summarizing its economic assessment and research.

For the first time, the Fed chose to devote a section of its report to whether the “gains of the economic expansion [have] been widely shared.” That section focused on how the recovery affected different races and ethnicities differently.

The results are discouraging. Despite years of job growth, the rates of full-time work for African Americans and Latinos are a few percentage points lower than they were before the recession, while the rates among white and Asian-American workers have more or less reached pre-recession levels. And the median income of black households, which took the biggest hit of any group during the recession, has also been slower to recover, reaching only 88 percent of what it was in 2007, compared with about 94 percent for the other three groups.

Responding to a question about the new section from Sen. Sherrod Brown (D-Ohio), Yellen insisted that weighing the disparate impact of economic growth on a range of different groups is a key part of the Fed’s mission.

“There are very significant differences in success in the labor market across demographic groups,” she said. “It is important for us to be aware of those differences and to focus on them as we think about monetary policy and the broader work that the Federal Reserve does in the area of community development and trying to make sure that financial services are widely available to those that need it, including low- and moderate-income [households].”

Yellen also recognized the importance of diversity — of race, gender, professional background and ideology — within the Fed’s ranks in ensuring the bank remains sensitive to a broad array of Americans’ economic experiences.

She touted her creation of a task force in the Fed to improve its gender and ethnic diversity, but acknowledged there is more to be done.

“Diversity is an extremely important goal and I will do everything I can to further advance it,” Yellen said.

Progressive groups and their allies in Congress trying to make the Fed more accountable to the public have focused on increasing diversity and reducing Wall Street’s influence at the central bank. Eleven senators, including Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), and 116 House members sent a letter to Yellen on May 12 urging her to prioritize the diversity of Fed officials, especially at the 12 regional Fed banks, which are privately owned. (Hillary Clinton expressed similar sentiments in a statement later that day.)

The makeup of the regional Fed bank boards is important because they are dominated by the big banks and have free reign to appoint their presidents. The regional Fed bank presidents hold five seats on the Federal Open Market Committee, the central bank panel that adjusts the benchmark interest rate. Currently, regional Fed presidents make up half of the FOMC’s influential votes.

As a result, the Fed officials with the power to raise interest rates and effectively increase unemployment are selected by people who are disproportionately white, male and from the finance and business sectors.

In the interests of changing that, the Fed Up campaign on Monday released a slate of 39 candidates for the regional Federal Reserve bank boards of directors. The candidates not only reflect racial and gender diversity, but also come exclusively from academic institutions, community groups and labor organizations.

“On racial and gender diversity there has been modest progress, though it has not taken place at the rate we would like to see,” Haedtler said. Haedtler added that there is even greater room for improvement when it comes to the diversity of professional backgrounds of board members and other top Fed officials, an area where he said there has been “regression” under Yellen’s watch.

By Daniel Marans

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The Express-Times - March 11. 2015, by Precious Petty - Pennsylvanians on Wednesday rallied in cites across the commonwealth and urged state legislators to put people first.

A dozen Lehigh Valley residents gathered outside Sen. Pat Browne's West Hamilton Street office in Allentown. They chanted "Listen up, Pat Browne" and displayed signs printed with the message "We rise," sometimes drawing shouts or honks of support from passersby.

Keystone Progress organizer Nicole Matos led demonstrators as they called for an education funding boost, a higher minimum wage, equal pay for women and increased Medicaid spending. Similar rallies occurred all morning and afternoon in Jim Thorpe, Pittsburgh, York and five other Pennsylvania cities, she said.

Matos, of Stroudsburg, said too many of the state's elected officials are making decisions that advance corporate interests while exacerbating inequality, hurting low-income and minority families, damaging the environment and weakening the nation's democracy.

National Day of Action rally on March 11, 2015 A National Day of Action rally was held March 11, 2015, outside Sen. Pat Browne’s office in Allentown.

Allentown School Board member CeCe Gerlach said more than 1,300 students have dropped out of city schools over the last three years and inadequate education funding is contributing to the problem.

"They've dropped out, partly, because our class sizes have increased. They've dropped out because we don't have enough textbooks all the time. They've dropped out because the teachers aren't able to pay each student the amount of individual attention that they require," said Gerlach, who was among the demonstrators.

"They've dropped out because many of them need jobs because their families, who are working at minimum wage, can't afford to pay their rent."

She said Browne has gone to bat for Allentown schools before and she's hopeful he'll step to the plate again this budget season.

"He's come through for the Allentown School District in the past," Gerlach said. "I'm hopeful he'll come through for the Allentown School District now."

Keystone Progress in a news release said the organization staged rallies outside the offices of legislators whose recent actions undercut public education. Browne, along with other Republican Senate leaders, sent school superintendents a letter advising them not to count on getting the education funding that's part of Gov. Tom Wolf's budget proposal.

A staffer at Browne's office declined comment about the rally, which was timed to fall on the National Day of Action.

Keystone Progress joined with National People's Action, Center for Popular Democracy and USAction to mark the day and send the message that it's time for legislators to put people and the planet first, the release says. People in 23 states participated in rallies and other events.

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A former Federal Reserve adviser is joining with an activist group to argue for overhauls at the central bank that they say would distance it from Wall Street and make its activities more transparent and accountable to the public.

Dartmouth College economics professor Andrew Levin—special adviser to Ben Bernanke and Janet Yellen between 2010 and 2012 when they were Fed chairman and vice chairwoman—is pressing for the overhaul with Fed Up coalition activists.

Dartmouth College economics professor Andrew Levin, special adviser to then Fed Chairman Ben Bernanke between 2010 to 2012, is pressing for the overhaul with Fed Up coalition activists. Many of the proposed changes target the 12 regional Federal Reserve Banks, which are quasi-private and technically owned by commercial banks in their respective districts.

“A lot of people would be stunned to know” the extent to which the Federal Reserve is privately owned, Mr. Levin said. The Fed “should be a fully public institution just like every other central bank” in the developed world, he said in a conference call announcing the plan. He described his proposals as “sensible, pragmatic and nonpartisan.”

The former central bank staffer said he sees his ideas as designed to maintain the virtues the central bank already brings to the table. They aren’t targeted at changing how policy is conducted today. “What’s important here is that reform to the Federal Reserve can last for 100 years, not just the near term,” he said.

That said, what is being sought by Mr. Levin and the activists is significant and would require congressional action. Ady Barkan, who leads the Fed Up campaign, said the Fed’s current structure “is an embarrassment to America” and Fed leaders haven’t been “willing or able” to make changes.

A Federal Reserve spokesman declined to address the proposal.

Mr. Levin wants the 12 regional Fed banks to be brought fully into the government. He also wants the process of selecting new bank presidents—they are key regulators and contributors in setting interest-rate policy—opened up more fully to public input, as well as term limits for Fed officials.

Mr. Levin’s proposal was made in conjunction with the Center for Popular Democracy’s Fed Up coalition, a group that has been pressuring the central bank for more accountability for some time. The left-leaning group has been critical of the structure of the regional banks, and has been pressing the Fed to hold off on raising rates in a bid to make sure the recovery is enjoyed not just by the wealthy, in their view.

The proposal was revealed on a conference call that also included a representative from Bernie Sanders’s presidential campaign, although all campaigns were invited to participate.

Mr. Levin says the members of the regional Fed bank boards of directors, the majority of whom are selected by the private banks with the approval of the Washington-based governors, should be chosen differently. The professor says director slots now reserved for financial professionals regulated by the Fed should be eliminated, and that directors who oversee and advise the regional banks should be selected in a public process involving the Washington governors and local elected officials. These directors also should better represent the diversity of the U.S.

Mr. Levin also wants formal public input into the selection of new bank presidents, with candidates’ names known publicly and a process that allows for public comment in a way that doesn’t now exist. The professor also wants all Fed officials to serve for single seven-year terms, which would give them the needed distance from the political process while eliminating situations where some policy makers stay at the bank for decades. Alan Greenspan, for example, was Fed chairman from 1987 to 2006.

With multiple vacancies in recent years, the selection of regional bank presidents has become a hot-button issue. Currently, the leaders of the New York, Philadelphia, Dallas and Minneapolis Fed banks are helmed by men who formerly worked for or had close connections to investment bank Goldman Sachs.

Mr. Levin called for watchdog agency the Government Accountability Office to annually review and report on Fed operations, including the regional Fed banks. He also wants the regional Fed banks to be covered under the Freedom of Information Act. A regular annual review hopefully would insulate the effort from perceptions of political interference, Mr. Levin said.

By Michael S. Derby 

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NY Daily News - June 16, 2014, by Erin Durkin - Undocumented immigrants in New York could become “state citizens” with a slew of benefits from driver’s licenses under a new bill to be introduced Monday.

Advocates are set to announce a bill that would allow immigrants who aren’t U.S. citizens to become New York state citizens if they can prove they’ve lived and paid taxes in the state for three years and pledge to uphold New York laws, regardless of whether they’re in the country legally.

“The path to achieving opportunity and equity and dignity for immigrants through Washington seems blocked by Washington’s general dysfunction,” said Andrew Friedman, executive director of the Center for Popular Democracy and a founder of Make the Road New York. “States should push for full equality and inclusion.”

The bill will face long odds in Albany, where even more modest immigration reforms have failed to get through the legislature.

The bill would apply to about 2.7 million New Yorkers who lack citizenship, including those in the country legally and illegally.

People who secured state citizenship under the bill would be able to vote in state and local elections, and run for state office.

They could get a driver’s license, a professional license issued by the state, and Medicaid and other benefits controlled by the state.

Immigrants would also be eligible for in-state tuition and financial aid, and would be protected from discrimination based on their status. And the bill would sharply limit state authorities’ cooperation with federal immigration enforcement.

The legislation would not grant legal authorization to work or change any other regulations governed by federal law.

It’s destined to be a longshot in Albany, where the DREAM Act, which would help undocumented students afford college, and efforts to offer driver’s licenses have failed so far.

But backers say it will prompt similar efforts in other states, similar to how states led the way on gay marriage, with talks on bills already underway in Illinois, Oregon, and Maryland.

“Obviously this is not something that’s going to pass immediately, but nothing as broad as this or as bold as this passes immediately,” said Sen. Gustavo Rivera (D-Bronx), the sponsor in the Senate.

The bill is estimated to cost taxpayers $106 to 173 million a year, while generating $145 million in new economic activity and saving drivers $100 million in insurance premiums, advocates say.

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